comprehensive guide to retirement planning ireland pension savings investments retire secured future happy dublin
Retirement Planning

A Comprehensive Guide to Retirement Planning

August 10, 2023

Welcome to FitzGerald Flynn Insurances, your trusted partner in retirement planning and financial security. Planning for retirement is often something that we put to the back of our minds and for many people, is something that isn’t properly thought about until it’s too late. Developing a concrete plan for your retirement as soon as possible is paramount to ensuring your retirement goals are achieved. Whether you're a young professional, a mid-career individual, or nearing retirement age, securing your future requires careful financial planning.

In this comprehensive guide, we'll explore the ins and outs of retirement planning in Ireland in 2023. We'll cover everything from understanding retirement options and pension schemes to creating a solid financial plan and addressing specific considerations for Ireland. Our goal is to equip you with the knowledge and tools necessary to make informed decisions about your financial future.

So, let's embark on this enlightening journey together. Get ready to discover how you can secure your future through effective retirement planning. And remember, while we aim to provide valuable insights, it's crucial to consult with professionals who can tailor advice to your unique circumstances. Reach out to our team at FitzGerald Flynn Insurances Ltd. for personalised retirement planning advice and take that first step towards a worry-free retirement. Let's begin!

Understanding Retirement Planning

First we’ll talk about the importance of financial planning. Financial planning is a roadmap that guides you towards your retirement goals. It involves assessing your current financial situation, setting realistic goals, and creating a plan to achieve them. 

First, take a good look at your current financial situation. This includes understanding your income and expenses, assets and liabilities. By knowing where you stand financially, you can set realistic retirement goals and identify areas that need attention. Additionally, familiarise yourself with the retirement age and eligibility criteria in Ireland. Knowing when you can access retirement benefits is crucial for effective planning. You can learn more about the Irish retirement age by reading our previous blog here.

Next, think about what you want your retirement to look like. Do you envision yourself travelling, pursuing hobbies, or simply enjoying a more relaxed lifestyle? Setting specific and achievable retirement goals will help you determine how much money you need to save and how to allocate your resources wisely. Furthermore, you need to assess when you would like to retire and then make the calculations necessary to understand if retiring at that desired age is possible. 

Estimating your future expenses is another important step. Consider factors like housing costs, healthcare expenses, daily living expenses, and leisure activities. Don't forget to account for inflation and potential healthcare needs as you get older. Having a clear idea of your expected expenses will help you create a financial plan that ensures your needs are met during retirement.

Now, it's time to create a retirement budget. This budget will track your income and expenses during retirement, allowing you to make informed decisions about your finances. Consider factors like pension income, investment returns, and any additional sources of income. A well-structured budget ensures that your retirement funds are allocated appropriately, providing you with financial stability throughout your retirement years.

Remember, financial planning is an ongoing process. Life circumstances change, and your financial plan should adapt accordingly. Regularly review and adjust your plan as needed. Seek professional advice from our team at FitzGerald Flynn to ensure your financial plan is well-suited to your retirement goals.

Types of Pension Plans in Ireland

In Ireland, retirement planning involves understanding the various pensions available to you. Understanding these options will help you make informed decisions about securing your retirement. Let's explore the main types of retirement plans available in Ireland: state pensions, occupational pension schemes, and personal pensions/PRSA’s.

  1. State Pensions: The Irish State Pension is a vital part of retirement income for many individuals. Recipients of the state pension will start receiving their payments once they reach the state retirement age of 66. There are two types of state pensions in Ireland, the contributory and non-contributory. The contributory state pension offers a larger payout than the non-contributory pension but the eligibility threshold is higher. To qualify for the state pension, you need to meet certain qualification criteria. Learn more about the Irish State Pension from our previous blog here.

  2. Occupational Pension Schemes: Occupational pension schemes are provided by employers and offer an additional avenue for retirement savings. The retirement age for occupational pensions is set by your employer and is generally between the ages of 60 and 70. There are two main types of occupational pension schemes: Defined Benefit (DB) and Defined Contribution (DC) plans.
  3. Defined Benefit (DB) plans: In a DB plan, your pension benefits are determined by a formula based on your salary and years of service. The employer takes on all risk related to your retirement benefits and the plan guarantees a specific income in retirement.
  1. Defined Contribution (DC) plans: With DC plans, both the employer and employee make contributions to an individual pension account. The eventual pension amount is based on the performance of the investments and the contributions made. DC plans offer more flexibility but also come with investment risks.
  1. Personal Pensions: Personal pensions provide individuals with flexibility and control over their retirement savings. Personal pensions are available to self-employed people who are taxed under schedule D or are in non-pensionable employment taxed under schedule E.
  1. Personal Retirement Savings Accounts: PRSA’s are available to everyone that has a PPS number resident in the Republic of Ireland. Only people with relevant earnings can claim income tax relief on their PRSA contributions. Any employee who is a member of a DC scheme may also make ‘voluntary contributions’ to an Additional Voluntary Contribution (AVC) PRSA to enhance their pension contributions.

The retirement age for personal pensions/PRSA’s is generally between 60 and 75 years of age, however, like other pension plans, you may be able to retire and draw down on your personal pension before the age of 60 if you are seriously ill or permanently unable to work. If you're self-employed, Personal Pensions/PRSA’s offer a valuable way to build your retirement nest egg.

Considering these retirement plans will help you develop a well-rounded strategy. Each plan has its own advantages and considerations, so it's essential to assess which options align with your financial goals and circumstances.

Remember, retirement planning is not a one-size-fits-all approach. It's advisable to consult with professionals who can provide personalised advice based on your unique situation. FitzGerald Flynn Insurances is here to offer expertise and guide you through the process of selecting the right retirement plan for your needs.

What are my Options at Retirement? 

One of the most important things to consider when planning for retirement is what you will do with your pension once you have reached retirement age. The three main options available to pension holders upon retirement, and the three options we will discuss here, are taking a tax-free lump sum, buying an Annuity, and investing in an Approved Retirement Fund (ARF).  

Taking a Lump Sum:

One option available to retirees is to take a lump sum from their pension. In Ireland, there is favourable tax relief for lump sum withdrawals, which makes it an attractive choice for most. When you retire, you can typically take up to 25% of your pension fund as a tax-free lump sum. Two examples of how this might look are as follows: 

a) If your fund is €500,000 you may take 25%, €125,000 as a tax free lump sum. The balance will transfer to an Approved Retirement Fund (ARF). 

b) if your fund is € 1,000,000 you can take 25%, €250,000, of which the first €200,000 is tax free and the balance of € 50,000 is taxed at 20%. The balance of the fund (€750,000) is transferred to an ARF. 


  • Immediate Access: Opting for a lump sum provides you with immediate access to a portion of your pension fund, allowing you to address any immediate financial needs or desires.
  • Flexibility: With a lump sum, you have the flexibility to use the money as you see fit, whether it's clearing debts, funding a dream vacation, or investing in other opportunities.


  • Reduced Pension Fund: By taking a lump sum, you're reducing the overall size of your pension fund, which means you’ll have less money to invest going forward.
  • Tax Considerations: Although a portion is tax-free, all tax-free income is limited at a €200,000 lifetime limit. For any lump-sum amount in excess of €200k, the excess amount will be subject to tax.

Buying an Annuity:

An annuity is another popular option for retirement planning. It is a financial product offered by insurance companies that provides a guaranteed income stream for life. When you buy an annuity, you exchange a lump sum of your pension fund for a regular income.


  • Guaranteed Income: Annuities offer a stable and predictable income, which can provide peace of mind, knowing that you'll receive regular payments throughout your retirement. Additionally, if you pass away when your annuity is in payment, your spouse will typically receive half of your annuity income. 
  • Protection Against Market Fluctuations: With an annuity, you're insulated from market volatility, as the income is not dependent on investment performance.


  • Lack of Flexibility: Once you purchase an annuity, you cannot access the fund you used to buy it. This lack of liquidity might not suit those who prefer flexibility in managing their finances.

Investing in an Approved Retirement Fund (ARF):

An ARF is a post-retirement investment option that allows you to keep your pension fund invested after retirement. It provides an opportunity to continue growing your retirement savings and manage your investments actively.


  • Investment Growth Potential: By choosing an ARF, your pension fund remains invested, giving it the potential to grow over time and generate additional income during your retirement years.
  • Control and Flexibility: With an ARF, you have more control over how your funds are invested, providing the flexibility to adapt to changing financial needs and market conditions.


  • Market Risk: Investing in an ARF exposes you to market fluctuations, and the value of your pension fund can go down as well as up.
  • Minimum Withdrawal Requirement: ARF holders must withdraw a minimum of 4% annually after age 61. If you do not take your 4%, Revenue will deem that you have and tax you accordingly.

More Things to Consider for Retirement Planning in Ireland

Retirement planning involves a few additional factors that are worth considering. Let's take a closer look at these aspects to ensure your retirement strategy is comprehensive and tailored to your needs.

  1. Taxes and Retirement: Understanding the tax implications of your retirement income is important. In Ireland, certain retirement income may be subject to income tax, PRSI and even USC. Take the time to familiarise yourself with the tax rules and allowances that apply to retirees. It's wise to consult a tax adviser or financial planner to optimise your tax position and make the most of your retirement income.
  2. Healthcare and Insurance: Healthcare is a crucial consideration in retirement planning. In Ireland, individuals aged 70 or over are entitled to a Medical Card, providing access to free healthcare services. However, it's still essential to consider potential costs for long-term care or specialised treatments. Adding private health insurance to your coverage can offer extra peace of mind and ensure comprehensive medical care during your retirement years.
  3. Estate Planning and Inheritance: Estate planning involves making arrangements for the distribution of your assets and ensuring your wishes are honoured after your passing. Having a valid Will is vital to specify how your estate should be managed and distributed. Seeking professional advice can help you structure your estate plan efficiently and consider inheritance tax implications.
  4. Social and Community Engagement: Retirement isn't just about finances; it's an opportunity to explore new interests, engage with your community, and maintain social connections. Think about how you'll stay active and involved during retirement. Join community activities, pursue hobbies, and nurture social relationships for a fulfilling retirement lifestyle.
  5. Regular Review and Adaptation: As retirement approaches and throughout your retirement years, regularly review and adapt your financial plan. Life circumstances change, and your goals may evolve. Stay informed about tax laws, pension regulations, and investment options. Assess your retirement savings, adjust your budget if necessary, and seek professional advice to ensure your plan remains on track.

Remember, at FitzGerald Flynn Insurances, we're here to support you in all aspects of retirement planning in Ireland. Our experts can provide personalised guidance based on your specific needs. Reach out to us today to discover how we can help you navigate the intricacies of retirement planning.

Taking Action for a Secure Retirement

Congratulations on reaching the end of our comprehensive guide to retirement planning in Ireland. We've covered essential topics such as goal setting, financial planning, taxes, healthcare, estate planning, and social engagement. Now, it's time to turn knowledge into action and secure your future retirement.

To get started, reach out to our team at FitzGerald Flynn Insurances. We're here to provide expert guidance tailored to your specific needs. Our professionals are equipped to help you create a solid financial plan, navigate the complexities of retirement savings, pensions and investments, and ensure you have the right strategy in place as you approach your retirement years.

Our insights

Over the years we have gained some experience. Every month we like to share them with you. Check in with our blog.


Before you call us, maybe your questions have already been answered.

Contact Us
Call us now
01 2122 895
Contact form